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Date: Tue, 7 Dec 2010 16:04:24 -0700
Subject: Re: [MISP] Fwd: RE: [MISP] STATE FILM SUBSIDIES: NOT MUCH BANG FOR TOO MANY BUCKS
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"However, these subsidies are so lavish that governments must cut vital public services to pay for them."
The basic assumption that the money will actually remain in the general fund if you cut subsidies is wrong when applying it here in New Mexico. It is a "rebate", a return of money paid in. If the money is not paid in due to loss in production that money will not be available to pay for other services to begin with. To argue the added value is something that is hard to measure but we all see the benefits everyday. You can't rob Peter to pay Paul when Peter never had the funds in the first place.
On Dec 7, 2010, at 2:43 PM, Stacy Sacco wrote:
***This is a MISP Listserv message. Responses are sent to the list by default.*** ***For more info about MISP and the listserv, scroll to the bottom of the page*** *I thought you might all want to see the response from the folks at CBPP to my email from last week. I certainly appreciate there having responded to my email and I would imagine would enjoy being part of this continued dialog. Happy holidays to all. Stacy-----Original Message-----
From: Shannon Spillane <email@example.com>
Sent: Tue, Dec 7, 2010 2:04 pm
Subject: RE: [MISP] STATE FILM SUBSIDIES: NOT MUCH BANG FOR TOO MANY BUCKS
Sue,Apologies for the delay in responding to your emails from last week. Thank you for sharing the list serv dialogue with us. My colleague, Dr. Bob Tannenwald, has written up a short note in response. We invite you to share these comments with the list serv if you like. Please find them below.Kind regards,ShannonShannon SpillaneDeputy Communications Director for Strategic InitiativesCenter on Budget and Policy PrioritiesPhone: 202-408-1080E-mail: firstname.lastname@example.orgResponse from Dr. Robert TannenwaldThank you for the discussion of my new report and for sharing with me your robust debate about this issue. I appreciate the opportunity to respond briefly to a few of the points made in the list serv exchange.First, I do not dispute that, by offering film tax subsidies, states induce producers to shoot movies within their borders. However, these subsidies are so lavish that governments must cut vital public services to pay for them. While residents get some work on movie productions, others lose their jobs as governments cancel contracts with vendors and lay off workers. For example, construction workers lay idle as maintenance, repair, and modernization of infrastructure are postponed. Teachers, police officers, and firefighters get let go. This has a ripple effect through the state economy. The laid off workers struggle to pay their rent, to support their families, and to make car payments. As their household budgets shrink, they spend less at the grocery store and other local businesses. The resulting economic drag wipes out the economic gains that movie making appears to generate. In short, film tax credits make governments rob Peter to pay Paul.To make matters worse, a large chunk of the benefits from film production goes into the pockets of nonresidents— out-of-state media pros. This is true even in New Mexico, where the state pays colleges and universities to train residents for media jobs and eligibility for its film tax credit is partially limited to residents. (A close reading of the New Mexico Film Office's study offers evidence on this point).Some other points:Arizona does have a film tax credit, with an appropriation of $70 million, the same order of magnitude as film tax credits paid out by New Mexico. Arizona is discontinuing its film tax credit, effective December 31.True, other industries get government subsidies. Most of these subsidies are just as wasteful and ineffective as the film tax credit and deserve scrutiny as well. This report, however, focused on film tax credits in particular.Movie producers moved back from Canada in large part because the Canadian dollar appreciated rapidly against the American dollar (by 50 percent) in the early part of the decade.Thank you for your consideration of these points.Just curious. Does the CBPP have a process for reviewing and responding to comments regarding your reports, as noted in the following email? Thank you.Stacy
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